How to get health insurance without a job

Getting laid off unexpectedly or voluntarily quitting a job without a new position lined up can be a nerve-wracking experience for many. As you become unemployed, you lose important benefits, such as health insurance.

It’s a scary situation to be in, as you never know when you might need to seek health care, as being uninsured can lead to ridiculously high medical expenses.

Unfortunately, the United States doesn’t have universal health insurance, so Americans must obtain insurance through their employer, apply to federal or state programs, or purchase it through the Health Insurance Marketplace or other insurance sellers.

As you seek new employment, it’s vital to find supplemental insurance until you land a new role. The good news is that you have several coverage options to choose from.

Why do I need health insurance?

It’s crucial to have health insurance when unemployed to maintain regular checkups, ongoing forms of therapy, and because you never know what can happen to your health.

“Insurance protects us from possible life events that we can’t afford to pay for,” says Virgie Bright Ellington, MD,  a medical billing expert and author of What Your Doctor Wants You Know to Crush Medical Debt. “Because medical bills are America’s #1 cause of debt and bankruptcy, health insurance helps reduce some financial risk of accident or serious illness.”

According to HealthCare.gov, there are several benefits associated with having health insurance, such as:

• Coverage for essential health care to maintain your health and treat illnesses and accidents.
• Protection from unexpected, high medical expenses.
• Lower costs for in-network health care before meeting your deductible.
• Access free preventive care services, including vaccinations, screenings, and certain checkups, before meeting your deductible.

Because you may not know when you’ll land your next role, it’s important to apply for health coverage as soon as possible. Health insurance in America is necessary regardless of whether you’re employed or unemployed to main regular health and wellness visits and because you never know when you might need it.

“[Health] insurance is even more critical when we have significantly reduced or no income,” Dr. Ellington says. “[The] risk of bankruptcy or a lifetime of debt due to needed medical care is more likely if we’re unemployed.”

Employed vs. unemployed health insurance

People employed in the United States receive health insurance through their employer, Medicare, Medicaid, or the federal HealthCare Marketplace.

“Because employers who provide medical insurance for employees pay for a large portion of monthly premiums, health insurance becomes accessible for those who otherwise are not able to afford costly health insurance premiums,” Dr. Ellington says.

Employer-sponsored health health coverage is offered to employees and qualified members of their immediate family, as part of their benefits package for employment. Large companies are most likely to offer this type of health coverage, with about 99% of companies with 200 or more employees offering health benefits.

These insurance plans provide coverage to about 160 million Americans, which is almost half of the United States.

Health insurance is a widespread benefit for many employees thanks to the Affordable Care Act’s employer mandate. The employer mandate requires certain employers to offer affordable insurance to their full-time employees working more than 30 hours per week or face a tax penalty.

If you’re married, you may be eligible to join your spouse’s employer-sponsored health insurance plan. Usually, changes can only be made during the open enrollment period, which occurs once a year.

However, some insurance plans count marriage as a “qualifying life event,” allowing your spouse to change their health insurance plan within 30 days of nuptials. Other examples of qualifying life events include loss of eligibility, having a baby or adopting, death in the family, changes in residence, and becoming a U.S. citizen. 

“Not every company allows employees to add dependents to their sponsored health insurance plan, but it’s worth looking into the terms of their policy, in case it’s available to you,” Mitchell says.

There are a few health insurance options available for people who are unemployed and uninsured.

The Health Insurance Marketplace is often the first place people purchase private health insurance plans. Depending on your income and household size, you may be able to get an affordable health insurance plan through the Marketplace.

If you recently lost job-based health coverage, you may qualify for the Marketplace’s Special Enrollment Period. This allows you to enroll in any health insurance plan available through the Marketplace at any time of the year. You typically have 60 days from the day you lost coverage to enroll.

Aside from the Marketplace, you may be eligible for the following insurance options during your unemployment:

• Medicaid
• COBRA
• Off-exchange
• Medicare

If you cannot afford insurance through the Marketplace or don’t qualify for other health insurance plans, you still may be able to access government-funded healthcare. 

How to get health insurance without a job

As you search for health insurance during your unemployment period, there are a few things you’ll want to consider when choosing a plan.

These factors include the following:

• Monthly premium costs. With little to no income, it’s essential to factor price into your health insurance plan. With private health insurance, you’ll be required to pay a premium. A premium is what you pay monthly to an insurance company to receive health coverage. If you don’t make the payments, you may lose your coverage.
• Plan and provider network. If you have certain healthcare providers, hospitals, or pharmacies you prefer, you must ensure they are covered under your plan. When you seek out-of-network providers and services, you may pay additional out-of-pocket costs or receive no coverage.
• Deductibles. A deductible is the amount you pay for covered healthcare services out of pocket before your health insurance plan begins to pay for care. You may be responsible for fully paying for specialist visits, procedure fees, and prescriptions, among other costs. However, the higher your plan’s deductible is, the lower your monthly premium typically will be.
• Copay or coinsurance. In addition to the monthly premium, you may need to pay out-of-pocket expenses for healthcare services, such as copays and coinsurance. A copay is the fixed amount you must pay for a covered service after paying your deductible. Coinsurance is a percentage of costs you pay for medications or healthcare services.
• Drug coverage. If you take prescription drugs, you’ll want to ensure that the health insurance plan you choose covers them. You can review the insurer’s formulary or list of prescription drugs to see what their plans cover. Typically, insurers divide the medications they cover into tiers. This allows you to see approximately how much the copays or coinsurance will be.

It’s also essential to consider your current health situation. If you don’t have any medical conditions, you may not need to choose a plan with a high premium.

“Understandably, many focus on the lowest monthly premiums when looking for insurance coverage without a job,” Dr. Ellington says. “If you don’t have a chronic illness or injury, this is usually the best long-term option.”

“However, those who need regular medical care should look at plans with higher monthly premiums because out-of-pocket costs – the percentage of coinsurance you’re on the hook for – are less,” she adds.

Health care programs for unemployed people

Here are the programs available to people who are unemployed and/or uninsured and how you can apply for coverage:

COBRA

The Consolidated Omnibus Budget Reconciliation Act (COBRA) is temporary health insurance that allows employees and their families who’ve recently lost their jobs to continue their health benefits for a limited period of time through their insurance plan.

COBRA continues your prior job-based health insurance, so you won’t need to enroll in a new plan.

COBRA is available for the following circumstances:

• Voluntary or involuntary job loss
• Reduced work hours
• Transition between jobs
• Death of the working primary policyholder (for their family)
• Divorce from the working primary policyholder (for their family)

“For [at least] the first 18 months after separating from an employer, you’re eligible to continue your insurance plan through COBRA,” Dr. Ellington says. “However, you’re now required to pay for the entire monthly premium, including the amount the employer had been paying.”

Your employer will provide you with the COBRA Election Notice, which includes detailed instructions on how to apply for coverage within 45 days of losing your job.

Marketplace insurance plans

The Health Insurance Marketplace is a federal government-run service that allows you to compare Affordable Care Act (ACA) compliant health plans, enroll or change your plan, discover premium subsidies, or get answers to your health insurance questions.

Aside from basic health care coverage, Marketplace insurance plans may offer dental and vision coverage and medical management programs.

To apply for coverage through the Marketplace, you must create an online account and complete a questionnaire regarding your income and household. From there, it will create a list of insurance plans you qualify for. After choosing a plan, you can begin the enrollment process to begin coverage.

Medicaid

Medicaid is a low-cost, federal and state-funded program that provides health coverage to low-income adults, children, pregnant women, older adults, and people with disabilities. Eligibility for Medicaid is based in-part on annual income, assets, citizenship, age, pregnancy, or parental status.

The lowest income to qualify for Medicaid varies, as each state has specific eligibility requirements. Visit your state’s Medicaid website to find additional eligibility rules.

If you qualify for Medicaid, coverage will begin on the date of your application or the first day of the month following it. If you no longer meet the eligibility requirements, coverage will stop at the end of the month.

Most Medicaid programs have an online application you can complete to be considered for this program, although you can also generally apply by mail or in person at your local Medicaid office.

Medicare 

Medicare is a federal health insurance program for people 65 and older, younger people with certain disabilities, and people with end-stage renal disease. 

The best time to enroll in Medicare is during the initial enrollment period, a seven-month period that starts three months before you turn 65, include the month you turn 65, and ends three months after you turn 65.

However, you may make changes to your Medicare coverage during Special Enrollment Periods when significant life events happen. This includes events like losing your job, moving, or an opportunity for other coverage. 

You can also enroll or make changes during Special Enrollment Periods when significant events impact your life. This includes events like losing your job or health coverage.

Off-exchange insurance programs

Off-exchange programs are any private plans offered outside the Marketplace that may or may not be qualifying health coverage according to the ACA requirement for coverage. Insurance companies, agents, brokers, and other insurance retailers sell these plans. You may also be able to obtain short-term health insurance through off-exchange programs as well.

It’s important to note that if you buy a private insurance plan outside of the Marketplace at any time, you won’t be eligible to receive premium subsidies, or other savings.

You’ll need to reach out directly to the insurance company to apply for their health coverage plans.

Comparing different health insurance options

Before applying to any of these programs, take time to compare them. Doing so can give you better insight into which insurance plan is the best fit for your current situation.

When comparing insurance options, consider price, network, and comprehensive coverage. You need to ensure that whatever plan you choose is affordable, gives you access to your preferred healthcare providers, and covers the healthcare services you need.

If you have no income and meet your state’s Medicaid eligibility requirements, Medicaid may be the best option, as it doesn’t have monthly premiums.

On the other hand, if you’re still making some income during your unemployment, or if you do not qualify for Medicaid, or have someone willing to help you make payments, try the Health Marketplace or seek off-exchange plans to find insurance plans within your budget.

If you have a pre-existing condition where you must visit certain healthcare providers and access prescription medications, consider extending your employee-sponsored insurance through COBRA coverage (if you can afford it) or exchange plans.

Health insurance plans compared

How to save on health insurance without a job

Unless you’re eligible for Medicaid, you can expect to pay for monthly premiums and other out-of-pocket costs with your chosen insurance plan.

“The Affordable Care Act (ACA) includes government subsidies to help adults in households below certain income levels pay their health insurance costs,” Dr. Ellington says. “As of 2022, of the 13.8 million adults enrolled in health plans through the exchanges/marketplaces nationwide, 12.5 million were receiving premium subsidies.”

Your eligibility for a premium subsidy is based on your income.

Below are the requirements for receiving premium subsidies:

• Have a household income that is at least 100% of the federal poverty level (FPL).
• Unable to access affordable coverage through an employer.
• Not eligible for coverage through Medicare or Medicaid.
• Have proof of U.S. citizenship or legal residency.
• Must file taxes jointly if married.

In addition to health subsidies, there are other ways to save money on your health insurance coverage during unemployment, which include the following:

• Get a prescription drugs discount card. Using a SingleCare savings card can save you money on costly prescription medications that your insurance may not cover.
• Use FSAs and HSAs. A health savings account (HSA) or flexible savings account (FSA) can help you cover the costs of provider visits and prescriptions and can also be used to purchase medical supplies like eyeglasses, hearing aids, and at-home COVID-19 tests.
• Only seek in-network healthcare providers. To get the most out of your insurance, use doctors and pharmacies within your plan’s network.

Insurance without a job FAQs

What is the lowest income to qualify for an ACA insurance subsidy?

To qualify for ACA insurance, you typically need to earn between $14,580 and $58,320 as an individual or between $30,000 and $120,000 as a family of four. 

Is COBRA cheaper than ACA insurance?

Typically ACA insurance is more affordable than COBRA insurance because of the subsidies that are available with ACA insurance. 

Are all forms of insurance coverage basically the same?

Insurance plans and coverage varies quite a bit from plan to plan and in the cost for coverage. Each plan has specific eligibility requirements, a particular set of covered services, and its own network of providers.